Question 1

No significant differences exist between the accounting standards issued by the FASB and the IASB.

Accepted Answer

A) True 
 B)False

Question 2

Identify each of the following as either internal or external users of accounting information. $$\begin{array} { | l | l | } 
\hline \text { A. } & \text { Payroll manager } \
\hline \text { B. } & \text { Bank } \
\hline \text { C. } & \text { President's secretary } \
\hline \text { D. } & \text { Internal Revenue Service } \
\hline \text { E. } & \text { Raw material vendors } \
\hline \text { F. } & \text { Social Security Administration } \
\hline \text { G. } & \text { Heal th insurance provider } \
\hline \text { H. } & \text { Managerial accountant } \
\hline
\end{array}$$

Accepted Answer

The answer of Identify each of the following as either...

Question 3

Which of the following is a service business?

Accepted Answer

A)  Microsoft 
B)  Dell Computers 
C)  Facebook 
D)  Walmart 
A)  Microsoft 
B)  Dell Computers 
C)  Facebook 
D)  Walmart

Question 4

Proper ethical conduct implies that you only consider what's in your best interest.

Accepted Answer

A) True 
 B)False

Question 5

Dave Ryan is the CEO of Ryan's Arcade. At the end of its accounting period, December 31, Ryan's Arcade has as liabilities of $125,000. Using the accounting equation, determine the following amounts:
a) stockholders' equity as of December 31 of the current year
b) stockholders' equity as of December 31 at the end of the next year, assuming that assets increased by $65,000 and liabilities increased by $35,000 during the year

Accepted Answer

a) $325,000 $450,000

Question 6

Gomez Service Company paid its first installment on a note payable in the amount of $2,000. How will this transaction affect the accounting equation?

Accepted Answer

A)  increase liabilities Notes Payable) and decrease assets Cash) 
B)  decrease assets Cash) and decrease stockholders' equity Note Payable Expense) 
C)  decrease assets Cash) and decrease assets Notes Receivable) 
D)  decrease assets Cash) and decrease liabilities Notes Payable) 
A)  increase liabilities Notes Payable) and decrease assets Cash) 
B)  decrease assets Cash) and decrease stockholders' equity Note Payable Expense) 
C)  decrease assets Cash) and decrease assets Notes Receivable) 
D)  decrease assets Cash) and decrease liabilities Notes Payable)

Question 7

If a building is appraised for $85,000, offered for sale at $90,000, and the buyer pays $80,000 cash for it, the buyer would record the building at $85,000.

Accepted Answer

A) True 
 B)False

Question 8

Debts owed by a business are referred to as

Accepted Answer

A)  accounts receivables 
B)  expenses 
C)  stockholders' equity 
D)  liabilities 
A)  accounts receivables 
B)  expenses 
C)  stockholders' equity 
D)  liabilities

Question 9

An income statement is a summary of the revenues and expenses of a business as of a specific date.

Accepted Answer

A) True 
 B)False

Question 10

Match each transaction with its effect on the accounting equation. Each letter may be used more than once.
-Received utility bill to be paid next month

Accepted Answer

A) Increase assets, increase liabilities 
B) Increase liabilities, decrease stockholders' equity 
C) Increase assets, increase stockholders' equity 
D) No effect 
E) Decrease assets, decrease liabilities
F)Decrease assets, decrease stockholders' equity 
A) Increase assets, increase liabilities 
B) Increase liabilities, decrease stockholders' equity 
C) Increase assets, increase stockholders' equity 
D) No effect 
E) Decrease assets, decrease liabilities
F)Decrease assets, decrease stockholders' equity

Question 11

Give the major disadvantage of disregarding the cost concept and constantly revaluing assets based on appraisals and opinions.

Accepted Answer

Accounting reports w

Question 12

Which of the following is not an asset?

Accepted Answer

A)  investments 
B)  cash 
C)  inventory 
D)  stockholders' equity 
A)  investments 
B)  cash 
C)  inventory 
D)  stockholders' equity

Question 13

Indicate whether each of the following accounts represents an asset, liability, or stockholders' equity:
a) Accounts Payable
b) Wages Expense
c) Common Stock
d) Accounts Receivable
e) Dividends
f) Land

Accepted Answer

a) liability
b) stockholders'

Question 14

Match each of the following characteristics with the financial statement it describes. Each financial statement may be used more than once.
-Has three sections: operating, investing and financing

Accepted Answer

A) Income statement 
B) Balance sheet 
C) Statement of retained earnings 
D) Statement of cash flows 
A) Income statement 
B) Balance sheet 
C) Statement of retained earnings 
D) Statement of cash flows

Question 15

Match each transaction with its effect on the accounting equation. Each letter may be used more than once.
-Contribution of land by stockholder

Accepted Answer

A) Increase assets, increase liabilities 
B) Increase liabilities, decrease stockholders' equity 
C) Increase assets, increase stockholders' equity 
D) No effect 
E) Decrease assets, decrease liabilities
F)Decrease assets, decrease stockholders' equity 
A) Increase assets, increase liabilities 
B) Increase liabilities, decrease stockholders' equity 
C) Increase assets, increase stockholders' equity 
D) No effect 
E) Decrease assets, decrease liabilities
F)Decrease assets, decrease stockholders' equity

Question 16

Revenue is earned only when money is received.

Accepted Answer

A) True 
 B)False

Question 17

The statement of cash flows consists of three sections: cash flows from operating activities, cash flows from income activities, and cash flows from equity activities.

Accepted Answer

A) True 
 B)False

Question 18

Match each of the following characteristics with the financial statement it describes. Each financial statement may be used more than once.
-The first statement prepared

Accepted Answer

A) Income statement 
B) Balance sheet 
C) Statement of retained earnings 
D) Statement of cash flows 
A) Income statement 
B) Balance sheet 
C) Statement of retained earnings 
D) Statement of cash flows

Question 19

The assets and liabilities of the company are $128,000 and $84,000, respectively. Stockholders' equity should equal

Accepted Answer

A)  $212,000 
B)  $44,000 
C)  $128,000 
D)  $84,000 
A)  $212,000 
B)  $44,000 
C)  $128,000 
D)  $84,000

Question 20

Land, originally purchased for $30,000, is sold for $62,000 in cash. What is the effect of the sale on the accounting equation?

Accepted Answer

A)  assets increase $62,000; stockholders' equity increases $62,000 
B)  assets increase $32,000; stockholders' equity increases $32,000 
C)  assets increase $62,000; liabilities decrease $30,000; stockholders' equity increases $32,000 
D)  assets increase $30,000; no change for liabilities; stockholders' equity increases $62,000 
A)  assets increase $62,000; stockholders' equity increases $62,000 
B)  assets increase $32,000; stockholders' equity increases $32,000 
C)  assets increase $62,000; liabilities decrease $30,000; stockholders' equity increases $32,000 
D)  assets increase $30,000; no change for liabilities; stockholders' equity increases $62,000

Exam 1: Introduction to Accounting and Business

No significant differences exist between the accounting standards issued by the FASB and the IASB.

Identify each of the following as either internal or external users of accounting information. A. Payroll manager B. Bank C. President's secretary D. Internal Revenue Service E. Raw material vendors F. Social Security Administration G. Heal th insurance provider H. Managerial accountant

Which of the following is a service business?

Proper ethical conduct implies that you only consider what's in your best interest.

Gomez Service Company paid its first installment on a note payable in the amount of $2,000. How will this transaction affect the accounting equation?

If a building is appraised for $85,000, offered for sale at $90,000, and the buyer pays $80,000 cash for it, the buyer would record the building at $85,000.

Debts owed by a business are referred to as

An income statement is a summary of the revenues and expenses of a business as of a specific date.

Match each transaction with its effect on the accounting equation. Each letter may be used more than once. -Received utility bill to be paid next month

Give the major disadvantage of disregarding the cost concept and constantly revaluing assets based on appraisals and opinions.

Which of the following is not an asset?

Indicate whether each of the following accounts represents an asset, liability, or stockholders' equity: a) Accounts Payable b) Wages Expense c) Common Stock d) Accounts Receivable e) Dividends f) Land

Match each of the following characteristics with the financial statement it describes. Each financial statement may be used more than once. -Has three sections: operating, investing and financing

Match each transaction with its effect on the accounting equation. Each letter may be used more than once. -Contribution of land by stockholder

Revenue is earned only when money is received.

The statement of cash flows consists of three sections: cash flows from operating activities, cash flows from income activities, and cash flows from equity activities.

Match each of the following characteristics with the financial statement it describes. Each financial statement may be used more than once. -The first statement prepared

The assets and liabilities of the company are $128,000 and $84,000, respectively. Stockholders' equity should equal

Land, originally purchased for $30,000, is sold for $62,000 in cash. What is the effect of the sale on the accounting equation?

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis, Product Pricing, and Activity-Based Costing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Lean Principles, Lean Accounting, and Activity Analysis

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